Maynila: Reviving a city through sustainable water

MANILA, Philippines - With its imposing Europeanstyle structures and spotless streets, foreign visitors once regarded Manila as the “Venice of Asia”; and while it was still a port city, Manila was already a thriving cosmopolitan hub. Asians, Europeans, and Americans walked along Taft and Roxas boulevards, dressed in their Sunday best, hobnobbing with friends and enjoying the tropical heat of the midday sun. Residents and foreignersalike flocked to Luneta Park and were lured by the natural charms of Manila Bay. On weekends, families gathered by the vast Quirino Grandstand. A kilometer away stood Escolta and Chinatown, then business centers of the country. Entrepreneurs would  cross the Jones Bridge, which arched over the majestic Pasig River, to reach the colorful stores of Quiapo. Life was simple and good. People indulged in heady talks of philosophy and politics because back then, having access to the basic necessities of life was nothing to complain about. Not until World War

II changed the face of Manila. The entire country grappled with the dire eff ects of war, and Manila tried to stand again on its own. Port operations went back  to normalcy and provided revenues and jobs to thousands who survived the war.

But development went only as far as nearby provinces, obliging economically-challenged rural folk to go to Manila to fi nd their luck. Manila’s population grew quickly, accompanied by rapid urbanization bereft of proper urban planning.

Basic services did not grow as fast, despite the city government’s enduring commitment to the welfare of its people.

Water woes

Manila also had to contend with a leaky and outdated water pipe system. Water being the most basic of human needs, the city’s aging water infrastructure eventually created problems for its people. From street corners to more prosperous enclaves and public buildings, people lined up for hours to fetch buckets of water. Families relied on expensive water tanks and booster pumps for their water supply. business establishments, running water was a problem; leaving public toilets smelly and nearly unfi t for human use. Not surprisingly, waterborne diseases became a major health concern. Unfortunately, there was little that the national and local government could do to rehabilitate the centuries-old water infrastructure system. The cost to replace the aging pipes was simply too high. The bigger misfortune lies on the price people had to pay for the dirty water. Slum dwellers paid almost P1,000 a month to deep well operators, while a typical middle class family of four paid over P3,000 to water dealers. With the government lacking enough funds to make things better, the national and local governments had no choice but to look for external funding. Privatization of water utilities was seen as the immediate solution. After a thorough study and an open bidding process, the Philippine government privatized water services in the Greater Manila Area. Maynilad Water Services, Inc. (Maynilad) would eventually take over the West Zone, where the water system of Old Manila, known among historians as the Carriedo water system, was located. Yet privatization did not immediately spell relief for residents of the West Zone, since Maynilad had to deal with the enormity of the problems that it inherited. The fi rst owners of the company struggled to keep it afl oat after it was hit by the

Asian Financial Crisis, regulatory disagreements, labor issues, and financial insolvency. For a time, it seemed that Manila residents would never be able to enjoy access to safe and aff ordable drinking water.

Maynilad revitalized

In 2007, Metro Pacifi c Investments Corporation (MPIC) and DMCI Holdings, Inc. (DMCI) took over Maynilad, armed with a strong resolve to turn the company around and signifi cantly improve water services in the West Zone. The new owners had much to work on. Beyond its poor services, Maynilad’s debt was sky-high at $240 million, and water leakages, represented by non-revenue water (NRW), stood at a staggering 66% by the end of 2006. Simply put, the company was losing more water than it was selling, averaging at 1,507 million liters of treated water per day. Immediately after its reprivatization, Maynilad developed a Water Service Transformation Program that adopted a holistic innovation strategy in order to provide clean, safe, and aff ordable water to people living within the West Zone. The program involved the transformation of Maynilad’s water system, people, business, customer services, and public image. The water company also invested in new technology to address the problems caused by the old and highly inefficient water network. However, its new owners still had to overcome another obstacle before they could even invest in any infrastructure project to improve services. Maynilad was under a court-administered rehabilitation and under threat of a labor strike.

Pipelaying project at Singalong, Manila

“The difficulty of the transition was obvious on everyone’s faces every time we meet to discuss the seemingly never-ending hurdles that continue to get in the way,” recounted Maynilad Chief Operating Officer Herby Consunji, who has been with Maynilad since its re-privatization in 2007.

In spite of that, MPIC and company’s rehabilitation through to the end, spending enormous time and resources in negotiation with its creditors, the rehabilitation court, labor union, and the Philippine government. Until finally a year after its re-privatization and five years ahead of deadline in 2013, it came with a resolution to prepay its  external debt – one of the fastest loan settlements ever made in Philippine history. “Everyone already set their sights on leading the company out of its legacy issues to finally implement viable, forward-looking solutions to foster sustainable living and development,” Consunji added. True enough, Maynilad began to roll out its P31-billion capital expenditure program parallel to meeting service obligations. The company believed that only by transforming its people, business, customer services, and water services in a short amount of time. By the end of 2011, Maynilad already raised its billed service connections by 48 percent and improved 24-hour water coverage to 84 percent. To date, a big majority of its customers are enjoying 24/7 water supply. The total number of customers increased from 6.1 million in 2006 to nearly 8 million in 2011.

Water pressure is much stronger particularly to those who live on the higher floors of buildings and condominiums. “Water, indeed the most valuable commodity to which access is everybody’s right, is finally within reach. We went through some very challenging periods but we’re glad that we were able to prove to our customers na sa Maynilad, dadaloy ang ginhawa,” said Maynilad President and CEO Ricky Vargas. As it continues to expand its coverage, Maynilad’s improved services are making a difference in the lives of more people. Surface water coming all the way from Angat Dam in Bulacan finally reached households in Cavite.

Maynilad also completed its state-of-the-art Putatan Water Treatment Plant, which sources its raw water from Laguna Lake – the first alternative water source to Angat Dam.

Maynilad President & CEO Ricky Vargas (third from left) accepts the Global Honor Award from the International Award Association.

Proving that its systems and processes meet stringent international standards, the company acquired a total of 40 ISO certifications for several offices and facilities. Maynilad is first

in the Philippines to acquire the ISO Certificate 14064 – the international standard for greenhouse gas accounting and verification.

Maynilad’s innovative programs have been recognized by several prestigious awardgiving bodies. Recently, the West Zone concessionaire was conferred the Global Honor Award by the International Water Association (IWA), for its remarkable Water Service Transformation Program. Maynilad was the sole winner from the Philippines, besting other entries from East Asia, Europe, West Asia and North America.

Good things keep flowing

“Consistent with the vision of our will strive hard to take our services to the next level to accommodate the evergrowing population and its evolving needs. And we will continue to empower our employees because they are Maynilad’s true game changers. Through our people, we can bring the transformative power of water to even more communities,” said Vargas. Filipinos can expect additional pumping stations and reservoirs in key portions of Maynilad’s service area (including one at PAGCOR in Pasay City); sewage treatment plants in the San Juan River basin area; and multi-sectoral efforts to clean up major water systems such as the Pasig River and Manila Bay. Maynilad is also acquiring ISO certifications for more of its facilities. Manila is still rugged at the seams and much more populous than it had ever been, yet finally benefitting from clean, affordable water. With the valiant efforts of the city’s stakeholders led by the LGU, Maynilad, and other private sector partners, as well as the increasing involvement of the people, the city is infused with a new life – once again developing into a beautiful and welcoming haven for its constituents and all who come by.

Improving organization efficiency